ABSTRACT
This chapter provides an analysis of budgetary politics predating the negotiation of the 2007-13 Financial Perspective. Budgetary politics have been central to the emergence and consolidation of Cohesion policy. Since 1988, EU budgetary planning has been based on so-called multi-annual financial perspectives, providing guidelines for income and expenditure over a five-to-seven-year period. Negotiating the annual budget had become increasingly fraught, with conflict between the Community institutions. The Financial Perspective set limits on spending, forming the basis for budgetary discipline in 1988-92. Following on from the Copenhagen commitment, the 1995 Madrid European Council asked the Commission to submit its opinion on the applications for EU membership and to undertake a detailed analysis of the EU financing system. The report was significant insofar as it confirmed Germany, Sweden, Austria, Netherlands and the United Kingdom as main contributors, adding weight to their arguments about burden-sharing' which became the key dynamic in the negotiations.
